Is Norway's EU example really an option for Britain?

Norway's relationship with Brussels - it is a member of the European Economic
Area, but not the EU - is seen by some Eurosceptics as the perfect model. Harriet
Alexander travelled to Bergen to ask whether abandoning the EU could
work for Britain.

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Norway's five million people were asked twice whether they wanted to join the EU – with referendums in 1972 and 1994 – and each time, after impassioned debate, narrowly voted NoPhoto: ALAMY

On the historic quayside, gazing out over the North Sea, the sunburnt young man took a swig of his lager and paused. "We want to be our own masters," he said finally, "and not let Brussels tell us what to do. Why should we be in the European Union and pay for the mistakes of other countries?"

With a shrug of his shoulders, he added the oft-heard British refrain: "We're better out of the EU."

But this was not a British shore, and the familiar phrases were not coming from British lips. In Bergen, Norway's second city, such views are almost universally held, and Hans-Erik Almas, 23, is among the 80 per cent of Norwegians who think their country is right not to be in the EU.

"Norway is strong and wealthy, so I don't see why we should put that at risk by joining," he said. "We already have the best parts of the EU without actually being a member."

It's an opinion increasingly shared across the sea, in Britain. Last week, writing in The Sunday Telegraph, David Cameron raised the possibility of a referendum on Britain's membership. And Norway is often cited as a perfect example of how to leave the EU, yet still thrive.

"People worry that if Britain left we would lose access to the Single Market and not be able to travel freely," said Robert Oulds, director of the Bruges Group think tank. "“But that is not the case. Britain can cancel its membership of the EU and retain the trade benefits, following Norway’s example. The only thing we will lose is the bureaucracy and expense."

Norway's five million people were asked twice whether they wanted to join – with referendums in 1972 and 1994 – and each time, after impassioned debate, narrowly voted No.

Instead Norway, along with Iceland and Liechtenstein, joined the European Economic Area (EEA) – an association of all 27 EU member states, plus the three non-EU members, which are all governed by the "Four Freedoms": the free movement of goods, services, persons and capital.

Norway is subject to just one third of the regulation of full EU members, although the EEA has no say over agriculture, fishing or justice and home affairs.

For Norway the arrangement appears to be working well. It is one of the richest and most contented nations on earth, with a GDP per capita of £40,000 – compared to £23,000 in the UK, and an EU average of £21,150.

Unemployment is at 3.25 per cent, while GDP is growing at 2.75 per cent per year – as it has on average over the last 40 years.

It also regularly tops the UN's survey of quality of life, with a generous welfare system – women receive 46 weeks maternity leave at full salary, compared to Britain's six weeks on 90 per cent – and free education is provided for all.

The country funds this through its huge reserves of oil, timber and fish which it manages prudently, stashing away large percentages of its oil revenues to fund the future healthcare needs of an ageing population.

"In Norway, we think that we are the best judges of our country's own interests," said Ola Hedsten, chairman of a farming cooperative with 55,000 members. Norway does not subscribe to the Common Agricultural Policy (CAP), so can manage its land as it wishes. But to food products sold to the EU must still meet Single Market regulations - and face an import tariff as well.

"The emphasis is on supporting small farmers to produce enough food for us to eat here," said Mr Hedsten. "The CAP is all about mass production, but we don't want that."

Other farmers claim that the EU’s backing of GM seed is against Norwegian wishes, and say that the Norwegian farmers’ methods are vital to preserve the traditional landscape.

“We don’t want to end up like Sweden,” said one, pointing out that their Nordic neighbour had suffered from an exodus from the countryside since joining the EU.

“Norway is a prosperous country and we want to stay that way,” said Gunnar Bakke, the regional business commissioner for Bergen.

“We take the long-term view and manage our resources carefully, so we don’t see why we should join the EU and then have to pay for everyone else’s profligacy.”

Some Norwegians are even more strident in their views.

"Norway should exit the EEA altogether," said Heming Olaussen, of the No to Europe campaign. "We are still forced to accept too many decisions from Brussels, and the EU is coming in by the back door.

"It would be far better to rip up the EEA and just have bilateral treaties. Norway is strong enough to stand on its own, and is an important trade hub so the EU won't be able to ignore it."

Bergen has been a merchant city since Viking times, capitalising on its waters and forested hillsides to become a key part of the Hanseatic League – a trading organisation which linked ports of northern Europe from the 1300s to the 1660s.

And that trading spirit prevails. With a population of 260,000, the city is home to many big oil firms plus the world's largest salmon farming company.

On the granite pavement by the quayside, giant slabs of salmon were for sale alongside scampi, whale meat and crabs. Reindeer sausages and elk-skin rugs were hawked with Nordic-style woollen jumpers and statuettes of trolls.

But for all the Norwegian tradition, the market had a modern flavour.

"I left Malaga because there was no work in the tourist sector there," said Ines Castro, 27. Like other migrant workers she earns €17 an hour, a fortune compared to wages in Spain.

"There is no way Norway should join the EU," said Gabriel Remotti, 25, from Rome. "At home it's a disaster. Here there are real opportunities."

Yet not everyone agrees that the Norwegian model – a trading partner with the EU, but not a member – is a good thing.

"I call the current situation 'The Unbearable Lightness of EEA'," said Paal Frisvold, chairman of Bellona Europa and campaigner for Norwegian membership of the EU.

"I live in Brussels and it makes me so sad to see all that we miss out on. Norway is being sidelined when it should be at the heart of Europe."

Torben Foss, a former civil servant who was in charge of writing the fishing chapter of the EEA, also believes it would be better if Norway joined the EU.

"There is a fear that if we did so the EU will suddenly come and seize all our fish," he said. "But that has absolutely no logic. Fishing rights are worked out on historic data, so it's absurd to suggest Norway's waters would be invaded like that."

Because Norway is outside the EU, he points out, its processed fish products face high EU import tariffs - 12 per cent in the case of smoked salmon - like the country's agricultural products. In return, French cheese imports to Norway are taxed at 400 per cent.

Oil, gas and manufactured products can be traded freely with the EU, because EEA members submit to all the directives connected with the Single Market.

"We are the most obedient of EU members, rapidly implementing directives to the letter, yet we have no say in them," said Marit Warncke, who heads Bergen's chamber of commerce. "We are sitting outside in the corridors, instead of being at the decision table."

Nor is membership of the EEA without costs, she points out. Through it, Norway contributes €340 million a year to the EU – despite neither being a member, nor having any voting rights. Were the UK to leave the EU, its annual contribution through the EEA might fall to just €2 billion from the net contribution of €11.6 billion it makes at present.

Some argue that losing the right to have a say on policy would be too high a price. Charles Grant, founder of the Centre for European Reform, sadi: "The City of London represents 75 per cent of Europe's financial markets, and it would be ridiculous to be sidelined like that."

On the streets of Bergen there is little enthusiasm for changing the status quo, but the debate continues. "People don't realise what is actually going on," said Mrs Warncke. "They think we are in a bubble, and just bobbing along quite happily.

"But we need to be more engaged in Europe for our own good – and Britain should not even consider leaving. None of us can just sit here alone and eat fish."